<p>USDJPY technical analysis: Looking at the phases of the market cycle using bull and bear channels</p><p>Bull channels are price trends with higher highs and higher lows. In a bull market, prices bounce off the lower trendline and rise toward the higher trendline. In times of economic development and investor confidence, financial assets are in high demand and market sentiment is favorable.
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A bear channel is a price trend with lower lows and highs. Prices decline from the top trendline and strike bottom at the lower trendline in a bear market. During economic recession and investor pessimism, financial asset demand drops and market sentiment is negative.

Prices fluctuate in a trading range without a distinct trend. </p><p>This market behavior might arise when market uncertainty or contradictory information impacting investor mood. The market may be indecisive and waiting for a stimulus to change direction, or it may be balanced by competing forces. Investment choices need knowledge of market behaviour and market cycles.
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The USDJPY has been moving in a bear channel, and its end, a bull channel starts. Most people would see that only when we are at least half way past the start of that move.

Next, we see to identify a possible end of the next phase, the end of the next channel.

In this video, I speculate where that can be. Those are interesting spots for traders, as the plan their next trade zones to focus on, due to the potential high reward vs risk that these spots offer. In our case now, this technical analysis is guiding me to look for a short trade if and when USDJPY gets close to (slighly above or below) 134.772</p><p>If and when it does, the reward vs. risk on that short trade would be 8 to 1, or even 10 to 1.</p><p>Naturally, traders can also decide to take a Long till then, but their stops should be below the lower band of the bear flag shown in the video, making the trade plan a bit vulnerable and less attractive in terms of reward vs risk.</p><p>Trade the US dollar vs Japanese yen at your own risk, and visit <a target=“_blank“ href=“www.forexlive.com“>ForexLive.com</a> for additional views.</p>

This article was written by Itai Levitan at www.forexlive.com.

<ul><li>This article will give some insights on the <a target=“_blank“ href=“https://www.forexlive.com/terms/t/technical-analysis/“ class=“terms__main-term“ id=“97b48ade-9582-40e4-af10-290ec70138af“ target=“_blank“>technical analysis</a> of the Russell 2000, as well as a deeper look at the important indicators that traders and investors should keep an eye on. On weekly and daily time frames, resistance and support levels, the 20 exponential <a target=“_blank“ href=“https://www.forexlive.com/terms/m/moving-average/“ class=“terms__secondary-term“ id=“d39a8864-434f-487e-bd1e-f9b895111210″ target=“_blank“>moving average</a> (EMA), trend lines, candlestick patterns, and VWAP (aVolume-Weighted Average Price) are all analyzed.</li><li>On the weekly chart, a bull flag has been spotted, and it is possible that this level of support will be retested in the near future. Because so many traders are keeping a close eye on it, the 20-day exponential moving average (EMA), which currently sits at 1857.6, is also an essential indicator to track. Be on the lookout for a potentially negative trend if two weekly candles close below the 20-period exponential moving average.</li><li>On the daily chart, there are many supports in the short term. These include the two-week low at 1883.1 and the 1900 round number, which is a favorite area for traders to set their stops. Both of these levels can be seen in the immediate vicinity. It is also important to take note of the trend line; although it is not always a fundamental component, several algorithms do monitor it anyway. If the daily close goes below 1900, the Bulls might find themselves in a precarious situation, as the Bears could start to gain an edge.</li><li>The analysis also mentions a revent candlestick pattern. When looking at the weekly timeframe as shown in the video above, consolidation is indicated when an inner bar is shown on a lower time frame. This is because the inner bar’s body as well as its low and high are contained within the bar that came before it. The fact that the closing price did not fall below the opening price of the preceding candle is positive information for the bulls, especially after many of them got kinda scared that we are going to crash down, following the bearish price action on Wed and Thurs, 1st and 2nd of Feb.</li><li>When trading the Russell 2000, keeping an eye on these technical indicators can help you obtain a better understanding of the market trend and make decisions that are more informed. Pay close attention to the 20-period exponential moving average, trend lines, and candlestick patterns, in addition to the bull flag and important support levels. The closest and key price level to watch is the 1900 round number. Bulls want to see that a weekly candle does not close below it. Those that seek earlier information (but at a higher risk of being faked out) will want to see that a daily candle does not close below 1900.</li><li>Trade the Russell at your own risk and do return to <a target=“_blank“ href=“www.forexlive.com“>ForexLive.com</a> for additional updates and views.</li></ul><p>BTW, here are 10 interesting facts that you may or may have not known about the famous Russell 2000:</p><ol><li>The Russell 2000 Index tracks the financial results of 2,000 of the largest U.S. small and mid-cap corporations.</li><li>Originally developed by Frank Russell Company in 1984, the index is currently managed by FTSE Russell.</li><li>The Russell 2000 is frequently used by investors and financial experts as a measurement of small-cap performance.</li><li>The index is a decent depiction of the small-cap portion of the U.S. stock market since it is made up of businesses with market capitalizations between $300 million and $2 billion.</li><li>The Russell 2000 is often regarded as a proxy for small-cap market performance, economic growth, and investor mood.</li><li>The Russell 2000 includes varied organizations from many different industries, such as IT, healthcare, consumer products, and finance.</li><li>Because it comprises smaller and less well-known firms, the Russell 2000 is seen as a more representative indicator of the U.S. stock market than the more widely followed S&P 500.</li><li>To maintain its relevance as a barometer of the small-cap market, the Russell 2000 undergoes yearly reconstitution.</li><li>Larger, more established firms are less susceptible to economic and market shifts than the index, which is notoriously volatile.</li><li>Interest rates, economic growth, and political events are just a few of the outside variables that might affect the Russell 2000’s performance. Thus, both retail and institutional investors use it as a resource when making financial choices.</li></ol>

This article was written by Itai Levitan at www.forexlive.com.

<p>I’ve been writing about anecdotal reports that US home and auto sales suddenly picked up in the past few weeks. They’re the most interest-rate-sensitive part of the economy so they’ve been hit hard by Fed moves. However with rates ebbing early in the new year, a torrent of pent-up demand emerged.</p><p>I think it’s telling.</p><p>It shows that consumer still have money to spend and still want those houses and cars. Vehicle production was curtailed by the pandemic and still hasn’t caught up. Covid-19 also inspired many people to buy homes and start families; many were initially priced out but that demand is still there.</p><p>He notes that some of it is seasonal but that can’t explain it. Earlier this week, Manheim reported that its used vehicle index rose 0.8% m/m and that caught many off guard. </p><p>Before that data, many analysts were expecting auto sales to round trip.</p><p>Today Morgan Stanley is out with a note looking deeper and finding the same thing but still without explanations.</p><p>They spoke with a Ford dealer who said:</p><p>“We’re just blown away by how strong January was… the best used car month we’ve had in three years.“Here’s the explanation: The consumer is still flush and the Fed has more work to do. That’s precisely what was <a target=“_blank“ href=“https://www.forexlive.com/news/4-trading-themes-for-2023-1-never-underestimate-the-spending-power-of-the-us-consumer-20230101/“ target=“_blank“ rel=“follow“>my #1 theme</a> at the start of the year when everyone else was saying a recession was coming.</p><p>The knock-on investment here is simple: Homes and cars. The risk is that the Fed hikes to something so painful (6%? 7%?) that it truly ends the party. The second thing is that pent-up pandemic savings will eventually run out, likely at the end of 2023 so next year could be double-trouble if the Fed hikes further and the money runs out.</p>

This article was written by Adam Button at www.forexlive.com.